PtG Article 06.09.2017

Code compliance methods cause concern in the UK

UK sports organisations are expected to comply with the national sports governance code by end October to maintain public funding. But is this type of sanction beneficiary for a sport and how to ensure that the code does not end as a tick-box exercise, observers ask.

British sport is moving towards compliance with the government’s new Code for Sport Governance but concerns remain over the methods used to bring sports into line.

The new code is among the most extensive of its kind and includes – among many others – targets such as greater transparency and 30% gender diversity on boards of National Governing Bodies (NGBs), which must comply by the end of October 2017.

More than 50 NGBs including the Football Association, the England and Wales Cricket Board, the Lawn Tennis Association and the Rugby Football Union (RFU) are compliant. All of the summer Olympic and Paralympic sports with funded ‘World Class programmes’ from UK Sport have also agreed detailed action plans to be compliant with the code by the end of October.

The penalty for non-compliance is the removal of all public funding, which for many major Olympic sports or minority sports can be a fundamental issue.

The success of the code in producing greater transparency and governance reforms in so many sports with improving governance is difficult, says Leo Martin, director of Good Corporation, which works in corporate responsibility and developed a sports governance framework.

“By punishing a sport and taking away its funding, you risk damaging the development of the sport but there is an absolute need for a balance. Some minority sports need support but they cannot be ran like a jumble sale,” says Martin.

In response, UK Sport said in a statement to Play the Game: “The changes that are required are significant for some organisations as they represent a step up for sports good governance in the sector generally, enabling a focus on the opportunity to develop exceptional sports governance that can grow and adapt to the challenges of the 21st century.”

The stakes are high

As the October 2017 deadline approaches, some NGBs are seemingly reluctant to discuss the issue despite being compliant.

British Cycling proved unable to comment despite approving constitutional changes including a board place for each of the 10 English regions in July.

A source close to the Lottery funding system told Play the Game: “For NGBs, the code is a sensitive topic at the moment because the stakes are so high for most of them.”

Some NGBs have produced reforms but still need these plans ratified or article changes approved and are confident enough of success to wait for annual general meetings (AGMs) in October.

More than half of the board at British Gymnastics are already female but article changes are still needed to become code compliant. Approval for these changes is widely expected at British Gymnastics’ AGM on October 21.

The RFU is proposing changes to the composition of its board and the introduction of maximum term limits for council members, but these proposals will only formally be presented to its council in October 2017.

All NGBs have had to agree on action plans with UK Sport, which is content to let some governing bodies wait until next year.

Sally Munday, the chief executive of England Hockey, explains: “We had to make some minor changes but nothing major and are going to take a few minor amendments to our AGM next year. It’s only small things like the language in our articles and who reports where in our nominations committee.”

Other NGBs have had to call extraordinary general meetings (EGMs) to get the proposals through rather than wait for an annual congress after earlier motions were rejected.

This has attracted negative media coverage but Munday said the wider achievements should be celebrated.

“The reaction to the code from the media is that they are trying to pick on those few sports that haven’t got their affairs to date rather than celebrate the massive progress that we have made in this area over the last decade,” Munday added.

Hard to bring changes to the table

One of those sports that struggled to ratify changes was table tennis.

Table Tennis England (TTE) was already compliant with some elements of the code, such as 30% gender diversity on boards. TTE has five women on its 12-poerson board including the chief executive, chairman and deputy chairman, but further changes were needed including the ability to appoint a chairman.

A proposal to allow for these changes fell just short of the 75% approval needed at TTE’s AGM in July 2017 and the sport had its £9 million-a-year funding suspended.

“The suspension of funding has caused cash-flow problems and reputational damage and restoring it was our top priority,” said TTE chairman Sandra Deaton after an EGM on August 12, when 96.7% of the electorate finally approved the reforms.

A spokesperson for TTE told Play the Game in a statement: “The change to our governance structure, as approved at the EGM, was made in order to allow for the appointment of a chairman.

“At present, the chairman is elected (as are the deputy chairman and treasurer) by the membership. Going forward, the chairman will be appointed by a sub-group of the board, in compliance with the government’s new code of governance. We are retaining three elected directors on the board, to preserve the democratic voice of the membership, and any of those will be eligible to apply for the position of chairman.”

With table tennis now compliant and changes at other sports such as British Gymnastics a formality, the British Mountaineering Council (BMC) is the only major governing body still to comply with the code but BMC did not respond to Play the Game’s request for a comment.

Longer timelines could be a concern

Although most sports have voted in constitutional changes to become compliant, these will not all have come into force by the end of October 2017 deadline.

Late adopters such as table tennis have work to do. TTE have created Governance Review Group led by senior independent director Mark Quartermain and is carrying out a review that ‘balances the need for democracy and a volunteer workforce at its heart.’

The spokesperson added: “The review will be overseen by a newly-created, a sub-group of the board, and led by an Independent Review Panel (IRP). The GRG has begun the process of drafting terms of reference for the IRP, identifying and interviewing IRP members and finalising the timeline.

“The Sport England deadline refers to becoming compliant with the Code of Governance. As we became compliant at the EGM, the review is not constrained by the deadline of October. There will be various stages of consultation in the months ahead, with the timeline leading ultimately to the next AGM in July 2018, where the IRP’s recommendations will be put to the membership.”

These longer timelines remain a concern. “What is important is what happens next and enforcement,” adds Leo Martin of Good Corporation. “We need an intelligent enforcement mechanism to see whether the spirit of the code is upheld and so it’s not a tick box exercise.”

“Only the start of the journey”

Further changes seem inevitable once the deadline has passed and some stakeholders are calling for the development of a stronger and more wide-ranging code in the future.

Dr Daniel Parnell, senior lecturer in Business Management at Manchester Metropolitan University, says: "Since its introduction we have seen real change through reforms across a number of NGBs. Financial consequences appear to be productive in delivering change in governance reform.

“Many believe this is only the start of the journey, as it would be fair to challenge the governance code for not doing enough. Whilst it has offered hope for females in the boardroom, it has offered little encouragement to other underrepresented groups such as the disabled, LGBT and those from BAME backgrounds. To me, it is clear that NGBs require a more thorough and substantial governance code, alongside a greater portfolio of education and professional development opportunities for leaders in sport.”

UK Sport did not explain what would occur if any NGBs become non-compliant after the end of October or in the future.

“The Code’s approach will delve deeper into what organisations are doing to drive greater diversity and give more public visibility of it, and by doing so the aspiration is to drive real change in the sector,” UK Sport told Play the Game in a statement.

“It calls for organisations to adopt a target of, and take all appropriate actions to encourage, a minimum of 30% of each gender on its Board; and demonstrate a strong and public commitment to progressing towards achieving gender parity and greater diversity generally on its board, including, but not limited to, Black, Asian, minority ethnic (BAME) diversity, and disability,” the statement continued.

Further work on the code is guaranteed, as the Code does not apply to organisations funded by the Welsh, Northern Irish and Scottish sport councils.

UK Sport says this will be addressed after the October deadline. Lobbying for more change also seems inevitable.

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